A simple and effective dead time compensation scheme for a PWM inverter-fed permanent magnet synchronous motor (PMSM) drive using the model reference adaptive control (MRAC) and coordinate transformation is presented. The basic concept is to first transform a time-varying disturbance caused by the dead time and inverter nonlinearity into unknown constant or slowly-varying one by the coordinate transformation, and then use the MRAC design technique to estimate this parameter in the stationary reference frame. Since the MRAC scheme is a suitable way of estimating such a parameter, the control performance can be significantly improved as compared with the conventional observer-based method tracking time-varying parameters. In the proposed scheme, the disturbance voltage caused by the dead time is effectively estimated and compensated by on-line basis without any additional circuits nor existing disadvantages as in the conventional methods. The asymptotic stability is proved and the effectiveness of the proposed scheme is verified.